Op Publicly Blames Nets for Rate Rise

Publish date:
Updated on

While most big MSOs are quietly raising rates about 5
percent to 6 percent in 1999, hoping rate regulation expires in March, some smaller
operators are pushing through bigger increases and blaming the situation on programmers.

One operator, 45,000-subscriber Massillon Cable in
Massillon, Ohio, is raising its expanded basic rate by about 14 percent, bumping that
46-channel service up to $46.25 per month from $43. That was Massillon's first rate
increase since January 1997, though, so the two-year average is probably on par with most

Still, Massillon vice president Robert Gessner wanted to
make sure customers got the message that at least from Massillon's point of view, more
than half of the increase was going directly to higher fees charged by programmers.

"I think the cable networks are raising their rates
unnecessarily" at a time when those networks are highly profitable, he said.

So Massillon made its case in a bill stuffer and in a video
shown on a local origination channel. It also published a Web page last month, urging
viewers to contact "expensive cable networks" and "urge them to use some

Among other data points on the Web page (http://www.sssnet.com/expensivenetworks)
was a list of percentage increases attributed to specific networks. The list could appear
to show annual increases, but actually shows fee increases since 1995, Gessner said. The
increases range from 30 percent for Discovery Channel and CNN to a whopping 358 percent
for Fox Sports Net. The page also published network mailing addresses and telephone
numbers and, in many cases, e-mail addresses of network presidents.

Gessner said he didn't think many subscribers had actually
complained to the networks. He said Massillon's marketing manager did hear about it from
one network, Home & Garden Television, apparently after the network's chief got some
e-mail. HGTV did not return calls seeking comment.